Marghany Advocates
Can anyone (including foreigners) own and occupy real estate in your jurisdiction (including shares in property owning companies)? Are there any restrictions?
Yes. Foreigners can own and occupy real estate under law no. (230) of 1996. However, such ownership is restricted to the following conditions: 1. Ownership is limited to only two real estate properties in Egypt for accommodation purposes in addition to the right to own real estate needed for activities licensed by the Egyptian government. 2. The area of each real state property shall not exceed 4,000 m2 and it shall not be a historical site. In addition, law no. (16) of 1963 prohibits foreign ownership of agricultural lands by both individuals and companies, as they are exclusively reserved to Egyptians.
Are there restrictions on lending for the purchase of real estate by foreign companies? If so briefly give an outline?
From a legal perspective, there are no restrictions with respect to lending for the purchase of a real estate by foreign companies. Nevertheless, every bank will have its own requirements and risk management procedures which may lead to certain restrictions. In practice, the two most general requirements to provide loans to foreign customers are a copy of a valid passport and a residency permit.
Buying
Please provide a short summary of the fees and costs (including tax) relating to buying real estate in your jurisdiction.
The costs can vary depending on the location of the property. The registration fees vary depending on the total value of the purchased real estate that is mentioned in the sale agreement between the seller and the buyer. In addition a tax is imposed by virtue of article 42 of law no. (158) of 2008 at a rate 2.5% and without any reduction on the total value of the purchased real estate. Such tax shall be paid by the seller, however it is possible for the parties to agree that the buyer shall bear the tax or split it.
Owning
Are there taxes applicable to owning real estate and can the burden of the taxes be passed to someone else (e.g. a tenant or an occupier - not being the owner)?
In accordance to article 12 of law no. (196) of 2008 the owner is liable to a tax at the rate of 10% of the annual rental value after deducting 30% for residential units and 32% for non-residential units in exchange for maintenance expenses incurred by the taxpayer.
Tax Breaks
Are there tax breaks or other incentives for foreigners to buy real estate in your jurisdiction? If so what are they?
As a general rule no tax breaks or incentives apply. However, article (18) of law no. (196) of 2008 provides that “real estates owned by foreign governmental authorities are exempt from tax, on the condition of reciprocity.”
How is the ownership of Real Estate evidenced in your jurisdiction?
The ownership of real estate is evidenced by registration at the notary public office. It should be noted, however, that a foreigner-owned property cannot be sold nor rented for a period of five years starting from the date of registration.
Is it possible to keep the identity of owners of real estate confidential in your jurisdiction?
All documents and data referred to in the notary public office regarding the ownership of a real estate are publicly available for inspection.